Trumponomics The Roots of Trump’s Global Trade War with Martin Wolf
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Apr 2, 2025 
Martin Wolf, Chief Economics Commentator at the Financial Times and CBE awardee, joins the discussion to unpack the roots of Trump's global trade strategies. They explore whether countries targeted by tariffs should have anticipated Trump's moves. Wolf sheds light on how the U.S. trade imbalances are not mere accidents but indicators of deeper economic vulnerabilities. The conversation dives into the potential consequences of tariffs on global market confidence and the risks posed to U.S. economic stability amid shifting policies.
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Global Imbalances and Instability
- Countries with large trade surpluses, like Germany and China, often achieve this through policies that suppress domestic demand and promote exports.
- This can lead to global imbalances and instability, as deficit countries accumulate debt to offset the imported weak demand.
Germany vs. China Export Models
- Germany's export-led model resulted in suppressed domestic consumption and weak private investment, leading to large surpluses.
- China's model involved capital controls, government intervention, and high savings rates.
Trump's Claims and Potential Benefits
- While Trump's claims about the US getting a raw deal are exaggerated, some countries' trade practices are destabilizing.
- Both Germany and China could benefit from increased domestic consumption.